Japanese manufacturer
Renesas Electronics is redeveloping its business continuity
plan (BCP) to factor in its entire supply chain in case another disaster
strikes.

The earthquake that
struck Japan on 11 March caused severe disruptions to the company. It was
forced to suspend activities at eight of its factories, effectively halving its
capacity. Its existing BCP enabled the company to resume production at its
factories by 6 June, however delays and disruption have continued in its wider
supply chain.

Its CSR and Environmental Report 2011,
released yesterday, said: “One of the most important lessons we learned through
the disaster was that we must establish a flexible structure to enable
efficient information sharing and alternate procurement and production, not
only for the Renesas Electronics Group, but also for the entire supply chain.
And such a structure must be realised through the synchronisation of BCPs of
all parties in the Renesas Electronics Group’s supply chain.”

In order to
strengthen the supply chain’s ability to continue operating and recover when
disruption occurs, the company is sharing information and working with its
suppliers to create an all-encompassing BCP. In addition, following its merger
with NEC Electronics, it is developing an “alternate production network” to bolster its
capabilities to cope with unforeseen external events.

The revised strategy, echoes the findings of the OECD Future Shocks Report, published in
June. It said: “Once a disaster strikes it is too late to create effective plans to
cover the fallout for production, employees, reputation, supply chains or
service disruption. Contingency plans for a broad range of adverse event
scenarios must be in place, and they must build in flexibility to account for
unknowns that can generate extreme events.”